Chancellor urged to step in to save jobs as HMV face staff become latest to face the axe

George Osborne was accused of prolonging Britain’s economic misery as the high street crisis deepened yesterday.

The stubborn Chancellor faced calls to rethink his chaotic policies, with millions of families in the grip of a painful spending squeeze and the country hurtling towards a triple dip recession.

But despite consumer confident hitting rock bottom and nervous firms refusing to unleash an astonishing £750billion of investment potential the Government refuses to even consider it may be getting it wrong. And while ministers bury their heads in the sand, ordinary workers are paying the price – with more than 4,000 HMV staff the latest victims.

The iconic music chain plunged into administration yesterday after eleventh-hour talks to save the 92-year-old business failed.

Around 4,350 workers face a nervous wait while officials try to find a buyer for the 239 stores.

The company is just the latest victim of a high street bloodbath that has claimed more than 200,000 retail jobs since the current economic crisis erupted in 2007. Another 48,000 shop jobs were lost last year, with JJB Sports, Comet and Peacocks among a wave of big name stores that collapsed.

Experts predict 2013 could be even worse, with around 50,000 retail employees in the line of fire.

The Government is nervously awaiting gross domestic product data for the last three months of 2012.

Analysts fear the economy shrank by 0.3% – with others warning the UK could lose its gilt-edged Triple A credit rating this year.

Shadow Business Secretary Chuka Umunna MP said: “We urgently need to help our struggling high streets and support the retail sector. But ministers are turning a blind eye while thousands of jobs are being put at risk. Failing to act while big name chains go to the wall is simply not good enough.

“We need ministers to junk their failed Plan A and adopt a proper Plan B for growth.”

Business Secretary Vince Cable admitted last night that he was concerned about massive job losses but claimed it was not the Government’s responsibility to step in.

He told Channel 5 News: “I am personally worried when I see hundreds, thousands of people losing their jobs… but it is not the job of Government to sort out the problems of competition on the high street. Consumers make their choices and there are consequences.”

HMV collapsed after negotiations with banks and suppliers failed.

Its demise was made worse by a fall of more than 10% in Christmas sales as the chain suffered from cut-throat competition and the booming success of online music and movie rivals.

Hopes of saving a chunk of the company rose last night after a flurry of early interest – including inquiries from retail restructuring group Hilco and two private equity firms.

HMV chief executive Trevor Moore – who previously headed Jessops which collapsed last week – said he “remains convinced we can find a successful outcome”. The latest jobs threat came as a growing number of MPs called for urgent action to support other struggling retailers – and accused Coalition ministers of doing nothing to help.

The Mirror can reveal that the all-party Commons Business Select Committee is preparing to launch its own inquiry into the Government’s support – or lack of it – for the retail industry.

Chairman Adrian Bailey said the committee was expected to start the investigation before the summer. He added: “Given the number of jobs involved there’s a case for holding an inquiry and looking at Government policy.”

The Labour MP said the review was also likely to look at business rates, which are set to rise again this April. He went on: “There is mounting evidence that the high street is suffering from changing social habits, the squeeze on consumer spending and the move to internet shopping.

“The regeneration of the high street is something the Government really ought to be looking at. It also needs to re-examine its business tax policy.”

He claimed too many once prosperous high streets now consist of “pawnbrokers, pay day loan offices, bookmakers or empty shops”.

Mr Osborne raised business rates by 5.6% last year – and they are set to go up again this April in line with inflation, by another 2.7%.

Treasury figures show the Chancellor will rake in £25.7billion this year and £26.8billion in 2013-14 from the tax.

Commenting on the latest casualty of the recession, a Downing Street spokesman said: “This is clearly sad news for HMV and its employees in particular, but the Government’s entire agenda is around the growth and job creation that we need.”

He added: “We have taken a number of measures to support the high street and it is very important that these are implemented. We need job creation across all parts of the private sector.”